Calling Obama a socialist hides the real debate

There's tension in the US over individual choice versus public good. That's why Obama has to get better at applying the power of individual incentives.

ByMark D. LangeNovember 5, 2009

San Francisco — Approaching a year in office, President Obama is not only waging two wars overseas, he's fighting a serious perception battle at home. It's more serious than an uncivil war of words and far-right rants about socialism and government-run healthcare. It challenges every dimension of the change and reform he promised this country.

The heart of the problem is that his far-reaching agenda hasn't appealed to the better judgment of the broad political center, not to mention the right.

He still can – if he enlists individual choice more effectively.

The power of personal choice runs deep in the United States. This country was founded on a distinctly creative tension between individual freedom and the collective good.

We were launched by a Declaration of Independence – yet our individual pursuits of Happiness have lately intensified our collective interdependence.

As an individual, for instance, I can choose to act as if:

I am what I buy.

I can choose a mortgage I can't afford. Multiply "me" by millions extracting fake home equity as a lifestyle choice, though, and "we" cause the greatest financial crisis since the Great Depression, impairing the global public good through personal "choice."

So the food industry designs sodium-, sugar-, and corn syrup-packed foods that are optimized to feed cravings, making me want to eat when I'm not even hungry – inflating healthcare costs for all of us.

I deserve healthcare benefits.

But I can skip the physical, rarely exercise, and insist on choice in a system that rewards unnecessary tests and heroic procedures but effectively precludes prevention. So every choice I make costs society far more. And will continue to, as long as healthcare "reform" pursues universal coverage without a careful recalibration of incentives and costs.

As individuals, Americans can't be told what to do. As a society, the costs of our collective fiscal, social, and environmental irresponsibility are mounting. Yet we're deeply distrustful – far more than European or Asian democracies are – when anyone else, especially in government, tells us what's good for us.

Which explains – more than the cynicism of racial politics, I think – why Mr. Obama is generating such resistance right now.

His inaugural call for a new era of responsibility inspired even the center-right as foundationally conservative. His calm, measured, fact-based approach still reassures. But the breathtaking scope of his policy ambitions – seeking comprehensive reform of every major social system at once – has proved deeply unsettling to a large share of the electorate, because it conflicts with the politics of choice (otherwise known as "freedom," or being left alone).

The multiplicity of the president's legislative agenda now seems less a measured response to a moment of crisis than a worrisome overreach in every direction. The effect is that of a Vishnu god (with many arms reaching into all corners of the universe), operating like a man with a hammer (to whom everything looks like a nail).

All of this puts the Obama presidency at spectacular risk, as his manifold ambitions of systemic reform sprint right into the swamp of limited government.

The US Constitution disperses power to individual and private interests to a degree unusual elsewhere in the democratic world – making it far more difficult to pass legislative overhauls than in parliamentary systems. American legislators and lobbyists have every reason to obsess over the impact on their interests. This interplay of individual priorities resists executive overhauls – leaving all sides muttering, "If only we were in charge."

"We the people" in any given administration aren't fully in charge, as the Founding Fathers intended. But the president could enlist choice politics more often through the bully pulpit, explaining how what each of us does as individuals has implications for the nation as a whole, as well as for each of us. And he could do far more to align private choice and the public good in his policy pitches.

The US has done this before. In environmental legislation, tradable emissions permits let businesses choose to clean up or subsidize other operators for doing so. In welfare reform, the Earned Income Tax Credit rewards individual efforts to outearn public assistance. Cigarette and gasoline taxes (gasp!) can work the same way. It's even possible in healthcare, through means-tested copays.

Such exceptions to the rule of gridlock have been legislated by both Democrats and Republicans – allowing individuals and even ideological conservatives the freedom of choice, but framing those choices to account for shared costs – what economists call second-order effects.

Look past the street theater and telepundits. The citizens of the United States are in the midst of the most fascinating and important conversation we've had since at least the 1980s about personal happiness and the public sphere, and the role we want – or are willing to allow – for government in our lives.

We have to get better at applying the power of individual incentives in service to the public good. Of course, nothing says the Obama team has to create smart markets for good behavior that enlist the American penchant for choice, and appeal more to the center-right. That's their choice.